Submenu Any amount paid on a loan by the borrower before it is required to be paid under the terms of the promissory note. There is never a penalty for prepaying principal or interest on federal loans.
Repayment of loan prior to the loan entering the repayment period or making monthly payments ahead of time. Written notification from the borrower is required when making payments in advance of their due date.
The repayment of a loan before the full term of the loan. Many loans set a repayment term (length of time to repay the loan). Some types of loans may have a penalty for prepayment of the full amount before the repayment term has ended. Astrive loans do not charge any penalty for early repayment; the borrower will only be charged the amount of interest that has accrued on the loan until the day the loan is paid off.
prepayment is an amount in excess of the amount due on a loan. If borrowers have more than one Direct Loan, they must specify which loan they are prepaying. Like all other Direct Loan payments, a prepayment first will be applied to any outstanding fees and charges, next to outstanding interest, and then to the principal balance of the loan(s). There is never a penalty for prepaying principal or interest on Direct Loan Program loans.
Paying on principal, or paying above the minimum payment required by the lender. In the beginning years of the loan, the minimum payment is usually all interest. Anything added to that payment will go to paying off the principal. The more the borrower prepays, the shorter the term of the loan will be. Sometimes there are Prepayment Penalties.
Meaning to pay all or part of a payment to the mortgage company. On a 30-year loan, paying additional money equal to one month's payment paid in one lump sum or spread out in increments will lower the length of the loan to 18 years.
Making early or extra payments toward the principal (amount borrowed). Prepayment can shorten the length of your mortgage and thus lower your total interest. However, lenders may charge a penalty if you pay off the mortgage very quickly, usually in the first few years. Be sure to ask about prepayment conditions in your mortgage and read all the documents.
Paying on pincipal, or paying abouve gthe minimum payment required by the lender. The minimum payment is usually all interest. Anything added to that payment will go to paying off the principal. The more you prepay, the shorter the term of your loan will be. Sometimes there are prepayment penalties.
Any amount of money that is paid on a loan prior to the scheduled time-- during a deferment or grace period (if applicable) or simply an extra payment during the repayment period. Usually, but not always, prepayment reduces cost and carries no penalty.
Any amount paid to reduce the principal balance of a loan before the due date. Payment in full on a mortgage that may result from a sale of the property, the owner's decision to pay off the loan in full, or a foreclosure. In each case, prepayment means payment occurs before the loan has been fully amortized.
Any amount paid to reduce the principal balance of a loan before the due date. Payment in full when a property is sold. Also where additional or augmented monthly payments to reduce the loan balance prematurely.
Any amount paid to reduce the principal balance of a loan before the due date. Payment in full on a mortgage that may result from the owner's decision to pay off the loan in full, a sale of the property or a foreclosure. In each case, payment occurs before the loan is fully amortized.
Allows the borrower to prepay a portion or all of the principal mortgage balance, with or without penalty, ahead of schedule. This decreases the total amount of interest paid over the life of your mortgage. This option is typically restricted to specific amounts and times.
Partial or full repurchase or other advance deposits of outstanding loan principal and interest by the borrower/debtor. The repurchase may be made at a discount from the current outstanding principal balance.
A clause that allows a borrower to make larger (or additional) payments than the amount stated in the loan agreement. It's in your best interest to make extra or bigger monthly payments on your loan since this will reduce your loan balance quicker than if you only paid the amount that's due. You'll also cut down the interest that you need to pay. Prepayment is also called the "or more clause."
Early payment of mortgage loans by homeowners. For investors in mortgage-backed bonds, prepayments pose a serious threat. Refinancing triggered by falling interest rates causes increased prepayments, which can cause bonds that are mortgage-backed to be called early. For the homeowner, however, prepayment provides an opportunity to save on mortgage loans.
The ability to repay installment credit before it is due, or to pay off a loan before its maturity date. Some loans, particularly mortgages, include prepayment clauses allowing you to repay them in advance of the regular schedule without a penalty.
The borrower's ability to make full or partial payments on a loan's principal before they are due. Paying a mortgage in full or in part before it is due may incur a penalty if so specified in the mortgage's prepayment clause.
A method providing in advance for the cost of predetermined benefits for a population group, through regular periodic payments in the form of premiums, dues, or contributions, including those contributions which are made to a Health and Welfare Fund by employers on behalf of their employees.
In a set of accounts this means something which has been paid out which covers a period after the end of the accounting period. You may have paid an insurance premium for the year to 30 September. If your accounting year ends on 30 June, 3 months of your premium will be prepaid.
With pensions, this is when an employer pays more contributions than the actuary has worked out are needed. The extra amount, called prepayment, is shown as an asset in the employer's accounts (rather than those of the pension fund ).